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A critical overview of the evolutionary approach to air pollution abatement policy

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  • John Merrifield

    (Assistant Professor of Economics, University of Texas, San Antonio)

Abstract

Emerging flaws in existing air quality policies and changing air quality objectives are being addressed with piecemeal modifications. The evolving policy combines a command and control (CaC) core with add-on opportunities to trade pollution control responsibilities based on economic incentives. While the add-ons have greatly improved air quality policies, retention of the CaC core means that we are still paying far too much for air quality that is still unacceptable. Specific reasons why a CaC core limits emissions trading and reduces economic efficiency are discussed. They include: (1) the arbitrary and irrelevant nature of CaC-based assignment of pollution control responsibility to firms; (2) trading limits for emissions offsets in 'non-attainment areas'; (3) all-ornothing deadlines that have been extended three times; (4) sunk costs as a barrier to innovation; (5) the illusion that a CaC-based policy has lower inventory and monitoring costs. The conclusion is that there will be a big difference between the performance of the existing policy, even with some additional modifications, and the kind of market incentives-based policies advocated by economists. Economists' proposals are now before Congress in congressionally sponsored studies. Reauthorization of the Clean Air Act, in some form, is expected this congressional session.

Suggested Citation

  • John Merrifield, 1990. "A critical overview of the evolutionary approach to air pollution abatement policy," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 9(3), pages 367-380.
    • Handle: RePEc:wly:jpamgt:v:9:y:1990:i:3:p:367-380
    DOI: 10.2307/3325281
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    References listed on IDEAS

    as
    1. Nelson, Robert H, 1987. "The Economics Profession and the Making of Public Policy," Journal of Economic Literature, American Economic Association, vol. 25(1), pages 49-91, March.
    2. T. H. Tietenberg, 1978. "Spatially Differentiated Air Pollutant Emission Charges: An Economic and Legal Analysis," Land Economics, University of Wisconsin Press, vol. 54(3), pages 265-277.
    3. Sue Anne Batey Blackman & William J. Baumol, 1980. "Modified Fiscal Incentives in Environmental Policy," Land Economics, University of Wisconsin Press, vol. 56(4), pages 417-431.
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    Cited by:

    1. Merrifield, John, 2002. "A general equilibrium analysis of the insurance bonding approach to pollution threats," Ecological Economics, Elsevier, vol. 40(1), pages 103-115, January.
    2. Yong-Jin Cha, 1997. "Evolutionary Environmental Policy: An Analysis of the U.S. Air pollution Control Policy," International Area Studies Review, Center for International Area Studies, Hankuk University of Foreign Studies, vol. 1(1), pages 102-114, December.
    3. Charles Howe, 1994. "Taxesversus tradable discharge permits: A review in the light of the U.S. and European experience," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 4(2), pages 151-169, April.

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